As the recovery process expands in the DeFi ecosystem following the KelpDAO-related rsETH crisis, a notable show of support has come from the Solana Foundation. The foundation has announced its intention to contribute to the recovery efforts $USDT to the Aave platform for the first time.
Lily Liu, president of the Solana Foundation, stated that this step was taken not only to support Aave, but also for the overall health of the DeFi ecosystem. Liu said: “Economies are not isolated. For Solana to be healthy, all of DeFi must be healthy.”
According to the announcement, the Solana Foundation is participating in a large-scale rescue initiative called “DeFi United” by lending it money $USDT makes a reservation for Aave for the first time. This initiative previously focused on closing the rsETH collateral gap with a 25,000 $ETH contribution proposal from the Aave DAO and support from various ecosystem players.
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However, Liu stated that they would not be limited to just liquidity support, announcing that the AAVE token would also be brought to the Solana network this weekend.
As you may recall, the security breach on the rsETH bridge resulted in billions of dollars in outflows from Aave, with some pools reaching 100% utilization and posing significant “non-performing loan” risks to the protocol. Recently, the recovery of $70 million worth $ETH by the Arbitrum Security Council and the support received through the DeFi United initiative contribute, albeit to a limited extent, to restoring confidence in the markets.
*This is not investment advice.